A clothing chief at John Lewis is in talks to take the helm at Hobbs, the private equity-backed fashion chain.

Sky News understands that Meg Lustman, who is due to leave the department store chain when her interim contract expires next month, is the frontrunner to become Hobbs' chief executive.

The chain has been searching for a new boss since Nicky Dulieu stepped down in February after eight years in charge.

Owned by 3i, the investment firm, since 2004, Hobbs endured tough Christmas trading after participating in heavy discounting seen across the high street, leading 3i to write down the value of its investment by £40m.

An insider said that Ms Lustman was one of several candidates for the chief executive's post but added that she was the favoured candidate.

Ms Lustman has been working as John Lewis's fashion buying director since last autumn, having previously run Warehouse, another high street fashion chain.

The company is chaired by Phil Wrigley, the former chairman and chief executive of New Look, who helped steer its rise to become the UK's third-biggest clothing retailer.

Hobbs opened its first store in Hampstead, north London, in 1981 and now has more than 140 branches throughout the UK and Ireland as well as franchise stores in the UAE and Sweden.

Earlier this year, it announced its entry into the US through a presence at a handful of Bloomingdale's department stores.

3i, which recently re-entered the FTSE-100 index after a two-and-a-half year absence, has held onto its investment in Hobbs for much longer than the typical ownership tenure of a private equity group.

Previous efforts to sell the business were aborted, and the firm is keen to complete an experienced management team which could potentially lead it through an eventual change in ownership.